Where do I begin?
Of course, you’re proud of your child’s college aspirations. But you might also be feeling overwhelmed. Isn’t everybody? It’s time to figure out how to cover the actual costs.
Don’t let the need to be perfect stop progress. Even if you can only save $50 a month right now, you’ll still be ahead of the game.
If I save a month
Estimated savings when my child is 18 years old:
* Assumes a hypothetical annual growth rate of 6%. For illustrative purposes. Not intended to portray an actual investment.
Ready to create a detailed plan?
Go to the college calculator
Yearly bonus? Tax refund? Put part — or all — of it into your 529 education savings plan.
Ask for gifts toward your child’s 529 savings plan on birthdays and holidays.
Have your child join in the effort.
Lemonade stands and part-time jobs can help grow the funds, too.
It’s better to start somewhere and start now. Small savings can make a big difference over time.
Saving for education is like planning a big trip — getting to your destination takes a good plan. A 529 savings plan is a popular way to save for college.
A CollegeAmerica 529 savings plan makes it easy.
Use a 529 savings plan for more than college tuition, including housing, required books and computer equipment.
The earnings on your 529 savings plan investments are exempt from federal taxes, and in many cases, there is a state tax benefit as well. Tax-advantaged treatment applies to savings used for qualified education expenses. State tax treatment varies.
A 529 savings plan can be transferred to cover the eligible educational expenses for a family member of the original beneficiary.
Wondering how to save for your child’s education? Get answers about opening an account, making contributions and withdrawals, updating your beneficiaries and more.
What educational institutions are eligible?
What if 529 savings plan assets aren’t used for qualified expenses?
Try to avoid withdrawing money for nonqualified expenses. If you use your 529 savings plan assets for nonqualified expenses, you could owe federal income tax on the withdrawal, plus a 10% penalty on the earnings. You may owe state tax as well. States take different approaches to the income tax treatment of withdrawals, so state tax may vary.
Can the beneficiary be a part-time student?
Yes! However, in order for room and board expenses to be covered, the student has to be enrolled on at least a half-time basis.
choose
You trust your doctor with your health and your mechanic with your car. You shouldn’t settle for anything less when you’re deciding where to invest your money.
Trusted by more than 1 million families nationwide, CollegeAmerica is the country’s largest 529 savings plan,1 with more than $66 billion invested.2
Work with a financial professional to open a CollegeAmerica 529 savings plan. He or she will help you to understand your choices and choose the best investment option for your family. Plus, working with a professional may give you some extra time to spend with your favorite people — your kids. If you don't have a financial professional, you can use our tool to search.
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses, summary prospectuses and CollegeAmerica Program Description, which can be obtained from a financial professional and should be read carefully before investing. CollegeAmerica is distributed by American Funds Distributors, Inc. and sold through unaffiliated intermediaries.
Depending on your state of residence, there may be an in-state plan that provides state tax and other state benefits, such as financial aid, scholarship funds and protection from creditors, not available through CollegeAmerica. Before investing in any state's 529 plan, investors should consult a tax advisor.
Statements attributed to an individual represent the opinions of that individual as of the date published and do not necessarily reflect the opinions of Capital Group or its affiliates. This information is intended to highlight issues and should not be considered advice, an endorsement or a recommendation.
American Funds Distributors, Inc., member FINRA.
This content, developed by Capital Group, home of American Funds, should not be used as a primary basis for investment decisions and is not intended to serve as impartial investment or fiduciary advice.
